THIS BLOG RATES THE S&P 500 BUY/SELL/OR HOLD EACH DAY WITH 2-GOALS FOR LONG TERM INVESTMENTS: (1) PRESERVE CAPITAL (2) BEAT THE S&P 500.
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Wednesday, March 26, 2014

DURABLE GOODS ORDERS – A MIXED
BAG (Business Week)“Orders to
U.S. factories for long-lasting manufactured goods rose in February by the most
in three months, but a key category that reflects business investment fell
sharply. This category fell 1.3 percent, the second setback in three months. Economists
said the weakness in business investment might reflect the severe winter, which
led some industries to put modernization and expansion plans on hold…’The
rebound could be huge once spring actually appears,’ said [Joel Naroff, Chief economist at Naroff
Economic Advisors.]”Story at…http://www.businessweek.com/ap/2014-03-26/orders-for-us-manufactured-goods-up-2-dot-2-percentDoug Short always has a great
analysis of durable goods adjusted for population growth and inflation.For the “real” goods on goods see…http://advisorperspectives.com/dshort/updates/Durable-Goods-Real-Per-Capita.phpS&P 500 APPROACHING AN
INFLECTION POINT (dShort.com)

“The winds are changing, my
friends. For most of the past year, each time the S&P 500 sold off, it was
a buying opportunity. I think we are at an inflection point this year, as we
all know nothing lasts forever… Very rarely does the S&P 500 increase
during a period of monetary tightening. This is not to say that the S&P 500
will drop tomorrow; the Federal Reserve is continuing monetary easing for the
moment. But investors in the market should be aware that once the Federal
Reserve begins changing its monetary stance, the S&P 500 will be affected.”
– Sasha Cekeravac posted at Advisor Perspectives at…

“Hundreds of people rushed to withdraw money from a
branch of a small Chinese bank after rumors spread about its solvency,
reflecting growing anxiety among investors as regulators signal greater
tolerance for credit defaults. The case highlights the urgency of plans to
implement a deposit insurance system to protect investors' deposits in case of
bank insolvency, given that Chinese are growing increasingly nervous about the
impact that slowing economic growth will have on the viability of financial
institutions.” Story at…

The yield on the 10-year Treasury Note fell sharply to 2.69%
indicating some real fear.

The market sold off sharply at about 1:30 and again in
the last hour today as the pros bailed out.CNBC blamed the losses on the US and EU who agreed to enact stronger
sanctions against Russia. Story at…

The 10-day moving average of stocks advancing on the NYSE
fell to 50.1% at the close.(A number above
50% for the 10-day average is generally good news for the market.)New-highs outpaced new-lows Tuesday.The spread (new-highs minus new-lows was +55.(It was +62 Tuesday). The 10-day moving
average of change in the spread was +4. In other words, over the last 10-days, on
average, the spread has increased by 4 each day. The smoothed 10-dMA of
up-volume continued up today.The
internals are positive on the market.

Market Internals are a decent trend-following analysis of
current market action, but should not be used alone for short term trading.
They are usually right, but they are often late.They are most useful when they diverge from
the Index.In 2013, using these
internals alone would have made a 16% return vs. 30% for the S&P 500 (in on
Positive out on Negative – no shorting).Of course, few trend-following systems will do well in an extreme
low-volatility, straight-up year like 2013.

NTSMThe NTSM analytical model was BUY today, Wednesday, based on the numbers that I follow.The Price indicator is positive, because up
moves have been bigger than down moves recently. Sentiment, Volume and VIX
indicators are all neutral, but the 5-10-20 Timer is positive as were the
Market Internals so today the NTSM system is a buy based on those one-time indicators.Given the action in the afternoon I’ll watch
the market ahead since the fears over sanctions will bring correction fears
back. NOTE: I'd be leery of buying stocks until the direction of the market is clearer.

MY INVESTED POSITION

I increased my stock allocation to 50% invested in stocks
because of the NTSM indicators turned positive Monday at the close.Given
the market sell-off in the afternoon, I may come to regret stepping up my stock
allocation today.Unfortunately, my 401k
rules require a change to be requested before noon and the market was relatively
calm at the time.

Followers

About Me

I am an engineer with a lifelong interest in "playing with numbers" so what could be more fun than trying to develop a system that beats the stock market? Well, lots of things, but I decided to do this anyway.
While I am not a finance-professional, or professional investor, I have developed some skills.
I competed in two CNBC Million Dollar Portfolio contests finishing in the top 4% in 2008 (34,320th of 800,000) and the top 0.1% (448th of 500,000) in 2009. More importantly, I managed to sell out of my retirement accounts at or near the top in 2000 and 2007 and bought close enough to the bottom that I didn’t lose too much sleep. (Even Bill Gates lost SOME sleep.)
I hope that my thoughts will help you achieve your investing goals. Please remember that my ideas are free and there may be times when my ideas are worth less than what you paid.